Finding 505468 (2024-005)

Material Weakness Repeat Finding
Requirement
P
Questioned Costs
-
Year
2024
Accepted
2024-11-13

AI Summary

  • Core Issue: Limited or no segregation of duties was found in key areas, impacting internal controls over the Federal award.
  • Impacted Requirements: This violates the requirement for effective internal control as outlined in Title 2 U.S. Code of Federal Regulations Part 200.303a.
  • Recommended Follow-Up: Management acknowledges the issue and has a corrective action plan in place; monitor implementation closely.

Finding Text

Refer to Section II for findings 2024-001, 2024-002 and 2024-003 Information on the Federal Program: Federal Agency: United States Department of Veteran Affairs Program Name: VA Supportive Services for Veteran Families Program (SSVF) CFDA: 64.033 Federal Award Identification Number: 14-MA-209 Federal Award Year: 2024 Specific Requirement: In accordance with Title 2 U.S. Code of Federal Regulations Part 200, Subpart D, Section 200.303a, the Organization is required to establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition Found: We noted there was limited or no segregation of duties for the majority of fiscal year June 30, 2024 in several areas during our audit. See Section II for findings 2024-001, 2024-002 and 2024-003. Context: We noted these conditions while obtaining an understanding of internal control for the respective transaction cycles listed in the findings. Questioned Costs: None noted Identification as a Repeat Finding, if Applicable: A repeat finding; See finding 2023-005, 2022-005, 2021-005, 2020-006 and 2019-007 Views of a Responsible Official and Corrective Action Plan: Management agrees with the finding and the recommendation. See Corrective Action Plan attached.

Corrective Action Plan

FINDING 2024-005 Corrective Action Plan Refer to the corrective action plans for findings 2024-001, 2024-002 and 2024-003. Finding 2024-001 Corrective Action Plan Before the end of fiscal year June 30, 2024, Veterans Northeast Outreach Center, Inc. (the Organization) began implementing procedures to strengthen its system of internal controls. Included as part of this implementation the Organization will begin procedures where: • the Executive Director reviews and approves each weekly payroll by email. In addition, any changes to the payroll being approved that differs from the previous weekly payroll will be noted in the email and part of the approval process. This includes new hire compensation and any adjustments to current staff. • the COO notifies the Executive Director and Chief Financial Officer of any terminated employee that has been removed from applicable benefits, software applications, and physical access rights within the Organization. • all checks will be procured at the front desk by intake staff and logged into a check and wire log before being brought to the Finance Office where the checks are then copied, deposited, and filed. • rent rolls are regularly updated by housing staff and any updates are made to the Organization’s accounts receivable subledger. Additionally, the Organization will be reviewing outstanding tenant receivables on a monthly and quarterly basis to ensure timely collection of rent. • all payments, including reimbursement and credit card purchases, be reviewed for appropriate backup and approved by the applicable program manager and/or supervisor; and all invoices and backup will be filed in the appropriate accounts payable file. Responsible party: Bill Kelly; Executive Director; (978) 853-7013 Anticipated completion date: June 30, 2025 FINDING 2024-002 Corrective Action Plan Management will work to identify a process of reviewing journal entries on a regular basis. The challenge with implementing a journal review process is the limited staff to facilitate a multi-level review of journal entries. The Organization will be discussing internally and with the Board of Directors a manner in which this can be accomplished. Responsible party: Bill Kelly; Executive Director; (978) 853-7013 Anticipated completion date: June 30, 2025 FINDING 2024-003 Corrective Action Plan Beginning in December 2024, the Finance Department implemented procedures where all bank account reconciliations are performed in a timely fashion the month following the closing of the previous month. Additionally, beginning in June 2024, the Finance Department implemented policies and procedures to have monthly financial reports prepared and provided to the Organization’s Board of Directors by the fourth Wednesday of the subsequent month for review. Responsible party: Bill Kelly; Executive Director; (978) 853-7013 Anticipated completion date: July 1, 2024 FINDING 2024-004 Corrective Action Plan The Organization’s senior leadership team has implemented procedures to track compliance deadlines and to monitor timely closing of financial periods. This monitoring will allow for the timely filing of the Massachusetts UFR by the required deadline of November 15, 2024. Responsible party: Bill Kelly; Executive Director; (978) 853-7013 Anticipated completion date: November 15, 2024

Categories

Internal Control / Segregation of Duties Matching / Level of Effort / Earmarking

Other Findings in this Audit

  • 505469 2024-006
    Material Weakness Repeat
  • 505470 2024-007
    Material Weakness Repeat
  • 505471 2024-008
    Material Weakness Repeat
  • 1081910 2024-005
    Material Weakness Repeat
  • 1081911 2024-006
    Material Weakness Repeat
  • 1081912 2024-007
    Material Weakness Repeat
  • 1081913 2024-008
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
64.033 Va Supportive Services for Veteran Families Program $2.36M
14.267 Continuum of Care Program $420,000
14.239 Home Investment Partnerships Program $307,230
64.024 Va Homeless Providers Grant and Per Diem Program $260,575